This is the title of a paper I presented at the Western Economic
Association Meetings in 1992 in San Francisco. I will be posting this
paper in parts. There will be 5 parts. This last part has the
bibliography and a transcript of the radio interview when Joseph
Campbell said entrepreneurs are heroes. Part 4 has footnotes.
THE HERO'S ADVENTURE
This part gives a basic outline of the hero's adventure in mythology.
The page
references in this part are all from Campbell (1968).
The hero 's adventure
This section provides a brief summary and description of the hero's adventure.
The following
summary of the hero's adventure comes from section 3, the Hero and the God,
which is in Prologue: The Monomyth in The Hero With a Thousand Faces.
"The standard path of
the mythological adventure of the hero is a magnification of the formula
represented in the rites of passage: separation-initiation-return: which might
be named the nuclear unit of the monomyth. A hero ventures forth from the world
of common day into a region of supernatural wonder: fabulous forces are there
encountered and a decisive victory is won: the hero comes back from this
mysterious adventure with the power to bestow boons on his fellow man.
"(p. 30)
In short, "The myths tell of a dangerous journey of the soul, with obstacles to be passed" (p. 366) Examples are Prometheus who stole fire from the gods and Jason who found the Golden Fleece. The universal nature of the myth is proclaimed with " ... whether presented in the vast, almost oceanic images of the Orient, in the vigorous narratives of the Greeks, or in the majestic legends of the Bible, the adventure of the hero normally follows the pattern of the nuclear unit above described: a separation from the world, a penetration to some source of power, and a life-enhancing return" (p. 35) and "Everywhere, no matter the sphere of interests (whether religious, political, or personal), the really creative acts are represented as those deriving from some sort of dying to the world; and what happens in the interval of the hero's nonentity, so that he comes back as one reborn, made great and filled with creative power, mankind is also unanimous in declaring" (p. 35-6). The myth helps us to understand "the singleness of human spirit in its aspirations, powers, vicissitudes, and wisdom" (p. 36). So there is a basic pattern to the hero's adventure which is universal.
The following
is Campbell's own summary of the entire adventure whose specific phases will be
referred to later in where it is compared to the process of entrepreneurship.
"The mythological hero, setting forth from his commonday hut or castle, is lured, carried away, or else voluntarily proceeds, to the threshold of adventure. There he encounters a shadow of presence that guards the passage. The hero may defeat or conciliate this power and go alive into the kingdom of the dark (brother-battle, dragon-battle; offering, charm), or be slain by the opponent and descend in death (dismemberment, crucifixion). Beyond the threshold, then, the hero journeys through a world of unfamiliar yet strangely intimate forces, some of which severely threaten him (tests), some of which give magical aid (helpers). When he arrives at the nadir of the mythological round, he undergoes a supreme ordeal and gains his reward. The triumph may be represented as the hero's sexual union with the goddess-mother of the world (sacred marriage), his recognition by the father-creator (father-atonement), his own divinization (apotheosis), or again-if the powers have remained unfriendly to him-his theft of the boon he came to gain (bride-theft, fire theft); intrinsically it is an expansion of consciousness and therewith of being (illumination, transfiguration, freedom). The final work is that of the return. If the powers have blessed the hero, he now sets forth under their protection (emissary); if not, he flees and is pursued (transformation flight, obstacle flight). At the return threshold the transcendental powers must remain behind; the hero re-emerges from the kingdom of dead (return, resurrection). The boon that he brings restores the world (elixir)" (p. 246-7).
Earlier it was stated that
Campbell's view of the hero's adventures is similar to Eliade's view. Below is
Eliade's (1990, p. 39) own summary:
"Another class of widespread
myths concerns those of the king's son who is abandoned after birth because of
a prophecy threatening danger to the king. Consigned to the waters, the child
is saved by animals or shepherds, and is suckled by a female animal or a humble
woman. When full grown, he embarks on extraordinary adventures (monster
slaying, etc.) Later he finds his parents and takes revenge, finally being
recognized and winning rank and honor. In most of these myths, the dangers of
trials of the hero (encounters with monsters and demons, descents into hell,
being swallowed by an aquatic monster, etc.) have an initiatory meaning. By
overcoming all these ordeals, the young man proves that he is surpassed the
human condition and henceforth he belongs to a class of semidivine beings. Many
epic legends and folktales utilize readapt the highly dramatic scenarios of a
hero's initiation (e.g., Siegfried, Arthur, Robin Hood, etc.).
THE PROCESS OF ENTREPRENEURSHIP
This part describes the process of entrepreneurship. A brief, general description is given first. Then the process of entrepreneurship according to Burch, Schumpeter, Kirzner and Gilder will be summarized.
Entrepreneurs are those people
who are able to discover an opportunity for economic profit either through
developing a new method of production that results in greater efficiency or by
producing a new product. In either case, the entrepreneur must be both a
creator and a risk taker. They are creators in the sense that they simply have
an idea for a more efficient production process or a new product. If the idea
were not new, the new method or product would already be used or on the market
and there would be no creativity. In that case, no opportunity for economic
profit would exist. This is because in a competitive environment economic
profits will erode when new firms enter the market. They are risk takers
because if it were absolutely certain that economic profits could be made,
there would be no risk. It would have been clear to anyone that the economic
profits were available and in a competitive environment entry of firms into the
market would have again eroded away the economic profits. Since there is uncertainty,
there is always some element of risk in starting any new business endeavor. The
entrepreneur is always taking a chance that the new venture will not only fail
to yield economic profits, but may fail entirely. Their actions are based only
on a hunch. Why does an individual take such a risk based only on a hunch or
their own creative work where no one else has done so before? What type of
individual will be both creative and willing to take a risk? The next four
sections deal with these questions.
Burch on Entrepreneurship
According to Burch (1986), "
... the essence of entrepreneurship is the initiation of change," (p. 17)
and is the "process of giving birth to a new business" (p. 18). It
usually appears from outside the present structure (p. 19). He lists the five
types of innovations brought by entrepreneurs that are from Schumpeter (Burch,
1986, p. 26):
1. Introduction of a new product or service that is an improvement in the quality of the existing product or service.
2. Introduction of a new method that increases productivity.
3. The opening of a new market, in particular an export market In a new territory.
4. The conquest of a new source of supply of raw materials, half manufactured products or alternative materials.
5. The creation of a new
organization
According to Cauthorn, these are
typical innovations and the list was not meant by Schumpeter to be exhaustive
(Cauthorn, 1989, p. 8). But where do these innovations come from?
"For making these or other
innovations, systematic and logical thinking can lead you just so far. For
thinking innovatively, imagination is more important than knowledge.
Imagination and the ability to think creatively come from the right side of the
brain. There we learn to think intuitively and creatively and learn how to deal
with fuzzy, messy problems" ( p. 28).
They do not come from logic. Reliance on "Logic alone points away from entrepreneurial activity" (p. 32).
The process of
entrepreneurship leads to
"Large corporations
[which] soon become risk-averting and cautious and are run, not by, innovating
entrepreneurs, but by bureaucratic committees. These bureaucratized giants
eliminate the entrepreneur and replace him or her with cautious and
conservative managers who are, at best, maintainers" (p. 24).
Schumpeter on Entrepreneurship
The process whereby the above
innovations occur was called "Creative Destruction" by Schumpeter
(1962). This was
"The opening of new
markets, foreign or domestic, and the organizational development from the craft
shop and factory to such concerns as U. S. Steel illustrate the same process of
industrial mutation if I may use that biological term-that incessantly
revolutionizes the economic structure from with in, incessantly destroying the
old one, incessantly creating the new one. This process of Creative Destruction
is the essential fact about capitalism. It is what capitalism consists in and
what every capitalist concern has got to live in" (p. 83).
Later he writes, while discussing
the above mentioned types of innovations (which he calls the function of
entrepreneurs), "This kind of activity is primarily responsible for the
recurrent "prosperities" that revolutionize the economic organism and
the recurrent "recessions" that are due to the disequilibrating
impact of the new products or methods" (p. 132). He saw the undertaking of
these new things as a distinct function performed by people who go outside the
normal economic structure.
Kirzner on Entrepreneurship
Kirzner discusses
entrepreneurship in terms of entrepreneurial or economic profit. This
discussion was given at the beginning of this part. Kirzner further clarifies
the process with
"But, during the
instant of an entrepreneurial leap of faith, the instant of daring the new line
of production, there is scope for the discovery that, indeed, the ends achieved
are more valuable than had hitherto been suspected" (p. 163).
Kirzner calls this as replacing the "old ends-means framework" with a new one.
Kirzner saw the essence of entrepreneurship as "unawareness both by the entrepreneur himself and by the market in general that he in fact possesses the resources of vision at all" (p. 180). And what does market entrepreneurship do? It "reveals to the market what the market did not realize was available or, indeed, needed at all" (p. 181). But although the entrepreneur was unaware of the opportunity for economic profit, he still must be alert to see the opportunity when it comes along.
There are two
main elements in entrepreneurship that Kirzner emphasizes:
1. Luck- The entrepreneur had a vision, he made a discovery. There was no systematic or efficient attempt to find a better product or method of production. But he was alert to the new opportunity.
2. Purposefulness-he acted in a
systematic way based on his hunch or vision
How is luck an important element
of entrepreneurship? For example you can find a large sum of money, and that is
luck. You might also stumble on a process or technique that can yield economic
profits. Is such a discovery luck? It must be. This raises the question of
whether pure profits can be sought systematically or purposefully. No. A person
may claim to be searching for economic profits and erroneous valuations of
resources by the market. But they must guess at where and how to search. If
they guess correctly, they were lucky. The entrepreneur simply has to be alert
to opportunities for economic profits and act on them when they come.1
Gilder on Entrepreneurship
For Gilder (1984), the entrepreneur and entrepreneurship make up what he calls the "real economy" in capitalism, not the "colliding multinational corporations, national industrial policies, and macroeconomic tides that overwhelm the simple energies and enthusiasms of individual entrepreneurs" (p. 31). Perhaps the following passages best illustrate what Gilder thinks entrepreneurship is:
"The entrepreneurial start-up is the most creative domain in American enterprise largely because it affords the best learning process. A man who builds a company from scratch acquires depth of understanding of what makes it work that an imported chief executive, however, effective his management information systems, however many cases he has explored in depth at the Harvard Business School, cannot easily command. The entrepreneur gains a dynamic and integrated view of his company and a realistic view of enterprise.
"Because he started in
rebellion against established firms, he bears a natural skepticism toward
settled expertise. Because he had to make scores of decisions before all the
information was in, he recognizes that enterprise always consists of action in
uncertainty. The entrepreneur prevails not by understanding an existing
situation in all its complex particulars, but by creating a new situation which
others might try to comprehend. The enterprise is an aggressive action, not a
reaction. When it is successfully launched, all the rest of society government,
labor, other businesses-will have to react. It entails breaking the looking
glass of established ideas-even the gleaming mirrors of executive suites-and
stepping into the often greasy and fetid bins of creation" (p. 247).
He calls entrepreneurship an "irrational process" carried on by "orphans and outcasts" (p. 275) in the face of a hostile environment (p. 56). The entrepreneur brings, through creativity, the unexpected boon by discovering the "unknown continents of the real economy" (p. 56). Entrepreneurship "requires a life of labor and listening, aspiration and courage" (p. 258) while being the "redemption of an oppressed and desperate world" (p. 258). The creativity comes from the immigrants, outcasts and former employees who are outside the established, large and dominant firms (p. 132).
To summarize these remarks, it could be said that entrepreneurship is a kind of creative, irrational rebellion committed in the face of uncertainty which occurs while the courageous entrepreneur is journeying on his own, personal path breaking adventure.
Gilder also sees entrepreneurship as a psychological journey of the entrepreneur.
"Any creative breakthrough, in science or art, enterprise or love, depends on glimpsing and engaging some higher realm of life. Beyond the long labyrinths of things, the multifarious carrels of fact, the inspired explorer can finally break out into the mansions of providential mind. He then sees the limits of the culture of thanatopsis: the dismal mazes of entropy and death, the grim aporias of sense and flesh, the vain hoards of sterile wealth. He can stand at last with wild surmise on the frontiers of matter where life and God again begin, and see a world renewed and shining with possibility" (p. 70).
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